What’s driving the Atlanta commercial real estate market?
- Gregg Metcalf
- Nov 14, 2024
- 7 min read
Updated: Nov 20, 2025
Population growth, ease of doing business, and robust demand position Atlanta as an investment magnet.
“Atlanta stands out among the nation’s commercial real estate investment markets, propelled by a unique combination of factors. These include healthy population growth, the relative ease of doing business, access to exceptional home-grown talent, and solid demand across asset classes. Leading companies and new residents are drawn to the city’s business-friendly environment, relatively affordable cost of living, and exceptional connectivity. With a projected population growth of 1.8 million over the next 30 years, Atlanta offers promising long-term real estate performance and investment opportunities."
Gillam Campbell Senior Manager, Atlanta Research
1- Apartments
Why Atlanta? Atlanta has been a popular market for corporate relocations, welcoming over 170 major headquarters since 2010 and fueling substantial job growth. Its affordability is also driving strong population growth, especially compared to other markets. Over the next 30 years, the City of Atlanta’s population is expected to swell by nearly 60% from 500,000 to nearly 800,000 residents, while the greater metro’s population is forecasted to grow by 1.8 million in the same timeframe – setting the stage for solid rental housing demand.
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Top spot for HQ relocations | 60% population growth in the city of Atlanta over the next 30 years | Solid rental housing demand |
Spotlight on undersupply
While Atlanta has over 22,000 new apartment units currently under construction, this represents just 4% of existing inventory levels — a mere drop in the bucket compared to the area’s significant population and job growth projections. Though this new supply technically overshoots expected absorption from employment gains alone, Atlanta is grappling with a housing shortage built up over the years. Atlanta will also be impacted by the $950 billion of multifamily debt maturities hitting the broader U.S. market over the next five years, potentially creating opportunities to acquire undervalued assets.
What to watch
With a limited pipeline of new supply amid constant population expansion, there’s an opportunity to acquire recently delivered stabilized apartment communities to capitalize on housing shortages and future rent appreciation. This is especially true in high-growth suburban areas like Gwinnett County, which is experiencing an influx of new residents drawn by Atlanta’s affordability and hearty business climate.
For the third consecutive year, Atlanta ranked in the top 3 markets for transaction volumes in 2023
2- Office
Green shoots emerging
Atlanta’s office market has shown promise in 2024. Large transactions, more than 75,000 s.f., have returned to the market with 19 deals recorded in the nine months to September. This already outpaces the full year volumes in all but one of the previous five years and is only one deal behind 2021’s year-end total. Overall leasing activity is on track to surpass 2023 levels - already 15% ahead at the half point of the year. While overall market absorption was negative, Class A absorption was positive in the third quarter and vacancy levels also declined.
The market direct vacancy rate, though at a record high, continues to slow its rise.
Occupiers have taken a varied approach to current market dynamics with some opting to reassess their footprints and downsize, while others are expanding their presence and either taking additional space at current locations for future growth or relocating into a larger space if they cannot be accommodated in their current buildings. These trends will potentialy shift in the coming year as availability of quality space continues to decline.
Development remains constrained
Only three office projects broke ground in 2023, and none are on the horizon for 2024. There are just 1.4 million square feet in development – the lowest level since 2015. This follows a decadeplus of disciplined supply growth that bypassed the overbuilding experienced in previous cycles. With no significant new deliveries on deck, competition for prime office space will likely intensify. This dynamic should help stabilize market conditions over the next 18 months and fuel a broadening recovery.
Increasing corporate footprint
Atlanta’s business-friendly environment, affordable cost of living and robust population growth make it an attractive corporate relocation and expansion hub. The metro is now the 6th largest in the nation in terms of population. Major employers like Home Depot, Delta, and Coca-Cola have established headquarter campuses here. Transformative mixed-use projects like Centennial Yards in Downtown and U.S. Soccer’s HQ relocation and national training center announcement are adding to the metro’s vibrancy.
What to watch
Office transaction volume in 2023 fell to just $680 million, a mere fraction of the $2.2 billion transacted on average over the prior 10 years. As large investors look to reenter the market, there is a short window for private investors to acquire quality assets in a hot Sunbelt market.
While sales volumes are still well below pre-pandemic levels, activity is picking up as institutional capital is becoming more active again
3- Industrial
Maintaining forward momentum
Atlanta’s industrial market has performed well in 2024, recording over 11.2 million square feet of positive net absorption which surpasses 2023’s totals. Completions continue to outpace demand, however the construction cycle has peaked and development activity has slowed significantly. While owner-user projects have boosted absorption quite a bit, demand was also generated by new deals in speculative product and second-generation space. The supply-demand gap is down from this time last year and will likely continue to tighten as groundbreakings have continued to slow and the pipeline is no longer being dominated by speculative developments. Leasing activity is also on the upswing, with over 38.6 million square feet of activity across 357 transactions so far in 2024, 60% of these being new leases. The market continues to see robust tenant demand in terms of requirements, however, deals are taking longer as users continue to prolong decision-making times. That said, several of the large industrial tenants that signed leases this year occupied their space in that same quarter. This promising shift will support continued healthy absorption in the coming months.
Custom buildings taking a larger share of the development pie
Atlanta has averaged 16 new industrial construction starts per quarter in the past eight years, totaling roughly 6.0 million square feet. Since early 2023, construction starts have dropped significantly and under construction volumes along with them. Projects that kicked off in 2021 and 2022 helped 2023 achieve recordhigh completion volumes, but annual deliveries are likely to start dropping as most of these have been built. Year-to-date, a little over 8 million square feet has broken ground across 18 projects, which is down by more than 35% compared to the same time period in 2023. As a result, the construction pipeline has continued to shrink. A sizeable portion of this pipeline consists of build-to-suit facilities for specific companies or owner-occupied projects rather than speculative developments. Build-to-suit and owner-built now account for over 17% of space underway while more businesses invest in customized Atlanta operations tailored to their needs.
What to watch
Until recently, institutional investors have largely been sidelined as pricing failed to adjust quickly enough to market conditions. We expect to see more deals transact given current attractive price levels and falling rates. Private capital has a unique opportunity to acquire assets before larger funds re-enter the market in force. Across Atlanta’s centrally located submarkets, soaring population growth combined with the e-commerce boom is creating an insatiable need for warehouse and distribution space to fulfill last-mile logistics needs. This demand provides private investors with chances to purchase older warehouses and reposition them to meet modern logistics requirements. Additionally, as construction costs and interest rates have skyrocketed, many mom-and-pop owners of smaller industrial properties are opting to sell for a cash payout while leasing the space back to continue their operations. This has provided another avenue for investors to gain quality industrial real estate at discounts to replacement costs.
BTS and owner-built projects position 2024 for market growth, having already overtaken 2023’s total with more to come
4- Retail
Retail shines with surging demand
Much like the rest of the country, Atlanta’s retail market is experiencing strong fundamentals: vacancy rates are incredibly low, as the demand for space—especially for the groceryanchored and unanchored strip—is strong and there is little new construction. Since the Great Financial Crisis, nearly 70% of Atlanta’s retail square footage has disappeared from the market due to densification, demolition, and conversions. This has created an acute supply shortage that will take years to replenish.
What to watch
While economic uncertainty remains, Atlanta’s population growth and still-recovering brick-and-mortar retail sector have positioned the market for continued near and long-term outperformance. And with stabilized, high-quality strip centers trading at significant discounts to replacement costs amid the debt financing crunch, investors can capitalize on suppressed cap rates for retail assets that will pay dividends for generations.
Getting retail-curious
As a result of the supply shortage, investment capital continues rotating into retail from other property sectors in pursuit of superior risk-adjusted returns. While institutional investors have slowly started re-entering the space, many remain skittish about long-term impacts. Now is the time to get in the game before institutional investors get serious.
Walkable urban and suburban retail prove value
Atlanta’s surging population base has created an insatiable demand for retail amenities across the market’s urban and suburban communities alike. Walkable, densely built retail districts are popular, including urban centers like street-retail concepts adjacent to the BeltLine and mixed-use hubs like Summer Hill and West Midtown. In the suburbs like Roswell and Alpharetta, where assets have been built purposefully to attract shoppers from all around, they are commanding premium rents and high occupancy.
How to Stay Ahead
Conduct a Needs Analysis to align your real estate strategy with your business objectives.
Secure and Optimize Office Location(s), Space(s), and Lease(s).
Maximize Profitability, Recruitment, and Retention
Many companies lose millions of dollars due to lack of employee engagement, loss of top talent, and inefficient or unneeded office space.
Working with Gregg Metcalf, clients gain the insights, the analysis, and the plan to obtain the lease and office space that retains the best employees, attracts top talent, and maximizes productivity as well as profitability.
To Contact Gregg Metcalf:
email: gregg.metcalf@jll.com
mobile: 404.661.9284
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